Parker Hannifin Corp. (NYSE: PH) has reported a 25% drop in second-quarter net income on flat sales, but has maintained its earnings guidance for the full fiscal year.
The producer of motion and control technologies said its net income in the quarter that ended Dec. 31 fell to $181.1 million, or $1.19 per diluted share, from $242.3 million, or $1.56 a share, in the year-earlier second quarter.
Sales at Parker edged down 1%, to $3.07 billion from $3.11 billion.
“We performed well in the second quarter considering continued economic weakness across all the regions we operate in," Parker chairman, CEO and president Don Washkewicz said in a statement. “Although economic conditions may improve, we continued to take prudent actions to strengthen profitability and cash flow as we enter the second half of the year, including cost reduction initiatives and adjustments to planned capital expenditures."
Parker reported a decrease of 2% in orders for the latest second quarter compared with the like quarter a year ago.
For the fiscal year ending June 30, Parker has maintained guidance for earnings from continuing operations in the range of $6.15 to $6.75 per diluted share. Fiscal 2013 guidance includes an expected year-over-year increase in domestic qualified pension expense of approximately 35 cents per diluted share due to accounting regulations that require the use of a lower discount rate based on current market conditions.
“Following the natural, annual cycle of our business, we anticipate that the second half of our fiscal year will be stronger than the first half,” Mr. Washkewicz said. “In addition, ongoing actions to reduce costs and maintain cash flow should position us for a strong finish to fiscal year 2013."